Calif. lawmakers take up budget vote on $15.7B gap

Republican state Senators Joel Anderson, of La Mesa, left, and Bill Emerson, of Redlands, confer during the Senate session at the Capitol in Sacramento, Calif., Thursday June, 14, 2012. Lawmakers are expected to vote on the 2012-13 state budget plan, Friday, to meet the constitutional deadline.(AP

/ AP

Republican state Senators Joel Anderson, of La Mesa, left, and Bill Emerson, of Redlands, confer during the Senate session at the Capitol in Sacramento, Calif., Thursday June, 14, 2012. Lawmakers are expected to vote on the 2012-13 state budget plan, Friday, to meet the constitutional deadline.(AP Photo/Rich Pedroncelli)

Republican state Senators Joel Anderson, of La Mesa, left, and Bill Emerson, of Redlands, confer during the Senate session at the Capitol in Sacramento, Calif., Thursday June, 14, 2012. Lawmakers are expected to vote on the 2012-13 state budget plan, Friday, to meet the constitutional deadline.(AP Photo/Rich Pedroncelli) (/ AP)

JUDY LIN, Associated Press

California lawmakers are taking up their plan to balance a $15.7 billion deficit without Gov. Jerry Brown's endorsement.

Lawmakers in the state Senate began debate Friday on a plan that includes fewer welfare cuts than the governor proposed. The Assembly is also expected to take up the bill.

Democrats are resisting deeper cuts to the state's welfare-to-work program known as CalWORKS and other social programs for the poor.

Republicans say the plan is incomplete and are urging Brown to veto the budget bill.

Lawmakers are running up against a midnight deadline to pass a balanced budget or they risk losing their pay.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP's earlier story is below.

California lawmakers huddled behind closed doors Friday as they prepared to vote on their plan to balance a $15.7 billion deficit before they run up against a constitutional deadline and risk losing their pay.

With Gov. Jerry Brown refusing to sign off on their plan, Democratic leaders said they would work to pass a budget and continue negotiations with him on several sticking points, particularly welfare cuts.

Democrats are urging the governor to back off from plans to cut programs that assist the poor, but Brown maintains the reductions are needed to help bring the state back to fiscal balance. Democrats, in turn, are resisting deeper cuts to the state's welfare-to-work program known as CalWORKS, child care assistance for low-income families, in-home supportive services, and eliminating Cal Grants for students who attend private colleges.

Both sides assume voters will approve Brown's initiative on the November ballot to raise the sales tax by a quarter cent and increase income taxes for people who make more than $250,000 a year.

A Field Poll released last week showed that a slim majority of likely California voters support the initiative, with the proposal leading by a 52 percent to 35 percent margin.

The measure is projected to raise $8.5 billion through mid-2013. If voters reject the tax hike, schools and other public entities would be subject to severe automatic cuts, which include shortening the educational year by several weeks.

The two sides disagree on how to distribute money to local governments that once went to community redevelopment agencies.

"We have worked closely with the governor all year, and there are small but important differences to resolve in the coming days," Senate President Pro Tem Darrell Steinberg said in a video released Friday on YouTube. He told reporters later that he had not met with Brown Friday and there was no resolution of their remaining disagreements.

Dozens of demonstrators lined the Capitol Rotunda, carrying signs and arranging strings of light bulbs into heart-shaped displays. Most were there to protest cuts to funding for in-home health care service providers. Many were in wheelchairs or used walkers to navigate the Capitol.

More than two dozen demonstrators have been arrested for disrupting the Capitol in recent days, though they stood or sat peacefully Friday as they waited for lawmakers to act.

The Legislature faces a midnight Friday deadline to pass a balanced spending plan for the fiscal year that begins July 1. Democrats said they intend to pass the main budget bill, which will keep their paychecks coming.

California lawmakers do not receive pensions but are the highest paid in the nation with a base annual salary of $95,290. Nearly all receive additional tax-free per diem payments of about $30,000 a year. Lawmakers are scheduled to see their pay cut 5 percent, or down to $90,525, starting Dec. 3.

On Thursday, Republicans sent letters to the state controller and treasurer asking them to verify whether the Democrats' budget proposal is balanced even though they have no authority over legislative pay.

Last year the governor vetoed the budget passed by Democrats, calling it unbalanced. The state controller withheld 12 days' pay but a judge has since found that the controller has no authority to block paychecks because it violated the separation of powers clause of the California Constitution.

Steinberg said the majority party plans to pass several companion bills but will delay voting on more contentious issues such as Brown's request to release financing for construction on the first leg of a bullet train in the Central Valley.

Brown spokesman Gil Duran said "discussions are ongoing."

Democrats agree with the governor on many aspects of his $91.4 billion spending plan.

Brown has proposed a 5 percent reduction in state worker pay that still must be negotiated with unions and he wants savings from the state's Medi-Cal program, which provides health insurance for low-income families.

Democratic Sen. Noreen Evans said party leaders have been working with Brown to try to avoid a budget veto.

"I'm very hopeful," she said. "The differences are so minimal that at this point I'm hopeful that he will sign it immediately."

Republican lawmakers, who have been sidelined from negotiations because Democrats can pass the budget on a majority vote, said the budget was not released in time for a comprehensive review. They criticize the overall spending plan, saying it lacked public pension reform or a spending cap to control government spending.

"It's sad, because there are no reforms in this budget," said Republican Sen. Sam Blakeslee.

Democrats put out a plan this week that doesn't save as much as the governor proposed. They sought to minimize the amount of cuts they have to make by slashing his proposed reserve fund from $1 billion to about $500 million.

Brown is proposing to cut $880 million from CalWORKS by establishing different levels of support that reward parents for working and reinstitute tougher work requirements.

Democratic lawmakers and advocates fear the changes would drive more families into homelessness because it includes welfare cuts by as much as 27 percent. They countered with a proposal to cut $428 million by extending existing cuts to counties to provide work training and child care.

Democrats also oppose Brown's plan to cut $225 million from the In-Home Supportive Services program, which helps disabled and sick people continue living at home. Brown wants to eliminate services for people who do not live alone and cut by 7 percent the number of hours of help they are eligible to receive.

Democrats are only willing to extend an existing 3.6 percent cut, which would save $90 million.

More than three dozen people have been arrested at the state Capitol this week in protests over cuts to home health care and other programs for the needy.